MReport November 2017

Contents of this Issue

Navigation

Page 50 of 67

TH E M R EP O RT
| 49
O
R
I
G
I
NAT
I
O
N
S
E
R
V
I
C
I
N
G
DATA
G
O
V
E
R
N
M
E
N
T
S
E
C
O
N
DA
R
Y
M
A
R
K
E
T
THE LATEST
DATA
Will Millennial
Homebuying
Trends Continue?
A least one area, conventional loans, stayed the
course, holding at 64 percent of all closed loans by
millennial buyers.
A
lthough interest rates
didn't show any signs
of dropping digits over
the summer season,
that didn't seem to deter home
-
buyers, according to August data
logged by Ellie Mae's Millennial
Tracker and released in October.
Conventional loans stayed the
course, holding at 64 percent of all
closed loans by millennial buyers.
Also keeping with the status quo,
FHA mortgages hovered at a mar
-
ket share of 32 percent—the same
figure that agency has been post-
ing since June, the report noted.
Additionally, the average dol-
lar amount for loans closed by
millennial borrowers in August
tallied $185,919, a negligible uptick
from the $184,113 recorded in
August 2016. This was notwith
-
standing the fact that the average
30-year note increased to 4.211
percent from 3.706 percent in 2016.
The average millennial primary
borrower was a 29.4-year-old who
used their $185,919 conventional
loan to purchase a home with
an average appraised value of
$223,882. This person had a FICO
score of 724, which enabled them
to secure their 4.211 percent loan.
They closed on their home in 44
days. The majority (64 percent)
of primary borrowers were male,
and more than half (52 percent)
were married.
On the West Coast, the aver
-
age millennial borrower was a
bit older—30.6—and took out a
loan of $314,579 on average. In
the Midwest, however, average
loan amounts trended lower. For
instance, homebuyers of age 29.5
in Kansas closed loans averag
-
ing $158,584. Island-hopping over
to Hawaii, the average borrower
there was a 31.4-year-old taking
out a $396,766 loan.
On the whole, millennials were
most likely to close loans for the
purpose of purchasing a home (87
percent). Refinances made up 12
percent of loans closed by millen
-
nials in August.
"Average loan amounts in
August of this year were slightly
higher than last year, despite
higher interest rates," said Joe
Tyrrell, EVP of Corporate
Strategy for Ellie Mae. "As tends
to happen with tight inventories,
this is a seller's market, and many
of today's homebuyers may be
faced with paying a premium for
the same home they might have
bought for less last year. For those
who are committed to buying a
home, though, slight increases in
competition, costs, or interest rates
will likely not deter them."
These Cities are Best at
Money Management
According to LendingTree, the residents of these cities
are the best in the country at living within their means.
T
hough 40 percent of
Americans say they're
struggling to make
ends meet, it seems
residents of Greenville, South
Carolina, have their finances
pretty well figured out. Ac
-
cording to a new analysis from
LendingTree, Greenville resi-
dents are the best in the coun-
try at living within their means.
LendingTree's analysis, which
looked at household income, mort-
gage balances, number of credit
inquiries, use of revolving credit,
and nonhousing debt, ranked the
nation's top 50 metro areas by
"how successfully residents are
spending within their means."
Greenville took the No. 1 spot,
despite having the second-lowest
household income out of all 50
cities. Residents are using just over
27 percent of their revolving credit,
and their housing debt balances
average just 62 percent of their
income—a big dip compared to the
50-city average of 79 percent.
Greensboro, North Carolina,
and Kansas City, Missouri, took
the No. 2 and No. 3 spots on the
list. Greensboro residents have
less than four credit inquiries in
the last two years, while those in
Kansas City have less debt (both
housing and nonhousing) than the
50-city average.
LendingTree also ranked the cities
where residents are worst at living
within their means, and topping the
list was San Antonio. According
to analysis, residents of the historic
Texas town use lots of revolving
credit, have high debt balances, and
take out bigger installment loans.
"San Antonio residents have
nonhousing debt balances that
represent 55 percent of their an
-
nual income, the highest of the
50 metros analyzed," LendingTree
reported. "Big loans for cars and
trucks could be a factor, with San
Antonio residents having an aver
-
age balance of $30,599 in install-
ment loans, the highest of the
metros analyzed and 26 percent
above the average."
Las Vegas and Phoenix were also
ranked at the bottom of the list.
Overall, the average resident in
the 50 ranked cities uses about 30
percent of their revolving credit
availability, which includes home
equity lines of credit and credit
cards.
"They also have mortgage bal
-
ances averaging 79 percent of their
annual income and nonhousing
debt balances averaging 44 percent
of annual income, and have had
five credit inquiries in the last
two years," LendingTree reported.
On the whole, millennials were most
likely to close loans for the purpose of
purchasing a home (87 percent).